Wednesday, October 29, 2008

Petrol price reduce lower than RM1.92?

I just don't understand the maths from the news above.

To quote certain parts of the article:

Ahmad Sarpur, a dealer in Johor, said dealers could lose between RM13,000 and RM25,000 each time petrol is reduced by 15 sen per litre.

“This is because there is a minimum order quantity of 21,000 litres that we must pay for immediately. There is no credit,” he said.

“If the petrol is delivered in the morning and the price is reduced at night, we have to sell petrol 15 sen cheaper than what we had paid for it.”

Shahrir said the Govern­ment had been fair to the dealers saying: “We have not reduced their margin of 12 sen per litre after it was increased in June and we will try as much as we can to keep upcoming price reductions to 15 sen at a time.”

Now, let's do the maths according to the article.

If the margin is 12 cent, and the government lower the price by 15 cent, the petrol dealers lose 3 cent per litre. If minimum order is 21,000 litres, this translate to a lost of 21,000 x 3 cent = RM 630, less than a RM 1000 as opposed to the blown up figure of RM13,000 to RM25,000. To lose RM10,000, one particular dealer will need to order 333,333 litres. In a time when the petrol price is erratic, which trader in his right mind will order that much amount of litres?

If Shahrir said the petrol price can never go below $1.92, what happens when the crude oil per barrel is less than USD 40?? Its sad that now that the economy is going downhill and moving towards global recession, the government is still thinking of squeezing from the rakyat. The rakyat paid the taxes, and still need to pay more than the world crude price, again who should be subsidizing who?

By the way, the petrol was raised to RM2.70 when the crude price hit $147 for a few days. Now that the crude oil has fallen more than 50% below USD 70 for more than a week, exactly how much should the rakyat pay per litre? I have no problems solving engineering maths, but somehow I could not crack this calculation. Can anyone do the maths for me? At night, we have to deal with thiefs, now we need to deal with daylight robbery, and this comes from none other than our beloved government! Is that's a Malaysian life should be?

1 comment:

Calvin said...

Petrol traders are whiners. Simple always wanting to make the cut. Don't see them complaining when the price was hiked. Every business has it's risk, what makes them so special? Don't want to get burn then get out of the business. They already make tons of money compared to the average Joe, yet they still bitch about all this and that. We the public are not stupid and you state the ballon losses.... my advice. Get an education and a life.
Looking at today crude oil the price of petrol should be lower than RM1.92 by simple ratio and common sense. Another pointer is that the Goverment made a blunder in giving out RM625 per car. The total value of pay out is more than what the Goverment subsidized last year. WTF!! They are going all wrong in managing tax payers money. This is what happens when senile leaders are let to lead. They should be in the old folks home ages ago. Those ministers in power know nuts as they dwell in tax payers money and undertable offerings which such petty matters as to petrol seems a waste of time. All I can say is that the country is run by monkeys spending all the money and the citizen getting peanuts. Bunch of wankers.